Tellers 'screwed' As It Glitch Brings Westpac To Its Knees

The Age

Friday June 6, 2008

Lia Timson

A SOFTWARE glitch threw Westpac into disarray this week, blocking branch access to customer records and retail banking services.

The national teller terminal outage was noticed by staff when trying to log in early on Monday. They could not serve customers over the counter, but allowed cash withdrawals of up to $500 without verifying account balances.

The limit was put in place to prevent fraud in the event of a prolonged outage.

Sydney branches put up signs advising customers that there was no estimated time of recovery, prompting one teller supervisor to say: "When the system crashes, we're screwed."

Teller staff were told the outage could last all day, but rejoiced when their terminals started returning to normal around 10am. ATMs and internet banking were not affected.

Westpac reportedly spent $70 million upgrading its branch computer system last year.

Westpac spokeswoman Jane Counsel said the incident had little or no impact on customers. "Westpac experienced a minor software problem which impacted our branch teller network for a short period of approximately 11/2 hours on Monday," Ms Counsel said. "The problem was quickly identified and rectified and customers experienced only minor delays to services as all branches were able to implement manual workarounds."

But retail customers were told no manual overrides were possible except for the nominal withdrawals.

A source close to banking teller networks said the problem was typical of a central mainframe hardware failure. "It's rare, but it happens," he said. "You can bet it's a hardware appliance. When fixed, it takes ages to get all the connections to the branches to fire up again."

He ruled out telecommunication outages because tellers still had access to the internet on their terminals.

Ms Counsel said the error was caused by the distribution of a new software release and was fixed by redistribution. It was not necessary to switch to disaster recovery mode.

The outage is the first in eight years and comes as the bank reviews its technology infrastructure and vendor contracts before the proposed St George merger. National Australia Bank, Commonwealth Bank and ANZ have also announced major information technology overhauls.

Bruce McCabe, managing director of S2 Intelligence, a leading corporate IT researcher and analyst, said while Westpac was likely to have suffered no financial loss during the outage, there was a short-lived risk of fraud and possible loss of goodwill among customers.

"It highlights the fragility of IT systems," Mr McCabe said.

© 2008 The Age

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